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Move over, Amazon. It looks like there’s a new industry-disrupting company in town.
That would be OpenAI, which unveiled a new arsenal of internal AI-powered software-as-a-service tools this week, causing a mass stock sell-off in the space.
If it sounds like something Amazon might do, that’s because the retail and cloud-computing titan has been having the same on a wide range of industries for years. It even picked up a nickname over time: “getting Amazon’d.” Just ask the pharmaceutical, insurance, and grocery industries about their experiences seeing market value wiped out.
While “getting OpenAI’ed” doesn’t have the same ring to it, the company’s newly shared SaaS plans are just the latest example of the value-swallowing impact it can have. And although the company’s SaaS tools are just for internal use at this point, investors aren’t waiting around for the possibility they’re eventually offered to other companies.
It’s also important to note that sometimes OpenAI itself doesn’t even have to announce anything to have a broad impact. In some cases, the companies themselves have highlighted the risk of tools like ChatGPT, causing investors to flee the stock.
Here’s a rundown of past examples of OpenAI hitting the share prices of its competitors:
Sept. 30: SaaS stocks tumble
OpenAI unveiled a host of internal software tools that can support sales teams, manage documentation, and provide customer support.
Founder Sam Altman had already hinted about a potential SaaS move when he posted this cryptic message on X in August: “entering the fast fashion era of SaaS very soon.”
Now, investors are preparing for a reality where those tools are used outside of OpenAI, even if that hasn’t happened yet.
The impacted stocks detailed in the chart below are: HubSpot, Docusign, ZoomInfo and Salesforce.
September 22: Broadcom takes a hit as OpenAI gets $100 billion from Nvidia
The leading AI hardware company and the leading AI software company make for a formidable pairing. Last week, Nvidia announced a $100 billion investment in OpenAI to accelerate the buildout of its data centers that will use Nvidia’s chips.
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Broadcom was the immediate loser of the announcement, with the stock dropping almost 2% on the news.
February 2024: OpenAI’s Sora video tool tanks Adobe stock
Adobe stock tumbled more than 7% after OpenAI unveiled Sora, an AI video generator. That appeared to compete with Adobe’s Firefly, its AI video generator that it launched in 2023.
Adobe partnered with OpenAI earlier this year to expand Firefly’s ecosystem of AI models.
“We’re pleased to work with Adobe to bring OpenAI’s image generation capabilities to its creators,” said Kevin Weil, OpenAI’s chief product officer, said in a statement in April.
May 2023: Chegg plunges after it says students are using ChatGPT for help with schoolwork
Chegg, which makes subscription-based tools for students to get help with school assignments, fell almost 50% in a day after the company said people are turning increasingly to ChatGPT for assistance.
“We now believe it’s having an impact on our new customer growth,” Chegg CEO Dan Rosensweig said on the company’s earnings call.
Shares of Chegg competitor Pearson also dropped as investors fretted over OpenAI’s impact on the wider ed-tech space.
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